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Archive for August, 2012

We love the blame game in Ireland, and perhaps over the summer break, we might have gotten out of practice, so here’s something that might refresh the rage.

The question “is NAMA working” is frequently asked, and in truth, the jury is still out as we monitor how NAMA is managing its assets.

But we can say at this point that the NAMA scheme, or the NAMA design, has failed.

Because of the very high haircuts imposed on loans acquired by NAMA, both Anglo and INBS – which represented the sources of 60% of the loans acquired by the Agency – have become unviable as financial institutions and are being run-down.

As for the other three NAMA financial institutions – AIB, Bank of Ireland and EBS – the €30bn of loans acquired by NAMA were such a tiny fraction of those institutions’ €250bn loan portfolios, that the NAMA process has made diddly-squat difference to their risk profiles. What NAMA actually did was made a bad situation worse, and in all likelihood contributed to the circumstances in 2010, when the market lost faith in our banks, which ultimately led to the Troika bailout.

What is unforgivable is the reckless absence of validation of true loan values before NAMA was formed in 2009, validation which would have shown that the NAMA design couldn’t work. What is sinister is the Wikileaks evidence that there was some private validation which showed the loans were in worst condition that publicly acknowledged, but that validation was never published. “True” loan values will be a moveable feast of course, and as the property market declined, so did the value of those loans, but there doesn’t appear to have been any consideration in 2009 of the consequences of the loans being so badly impaired that even after the NAMA process, the banks would fail and would need massive bailouts.

We saw last week with the publication of the half-year accounts for IBRC – the name of the company formed from the merger of Anglo and INBS – that even after NAMA had extracted €44bn of loans from Anglo and INBS, what remained at IBRC were over €28bn of loans, mostly commercial property with a staggering 66% of the loans impaired. IBRC is closing its residual INBS branches, is not generating any new business and is winding down its loans and operations before 2020. As far as IBRC is concerned, NAMA has done nothing but hasten its descent into its zombified state. In fact, if NAMA hadn’t existed then we wouldn’t have run up eye-watering legal and other professional fees in valuing loans and transferring them from IBRC which after all is 100% state owned, to NAMA which is also 100% state owned. IBRC’s €44bn of loans transferred to NAMA represent 59% of NAMA’s total loan acquisitions.

AIB transferred €19bn of loans to NAMA for which it received €9bn. According to the AIB annual report for 2009, AIB had a total loan portfolio of €123bn. EBS, which has now been merged with AIB, transferred just €0.8bn of loans to NAMA for which it received €0.4bn. According to the EBS annual report for 2009, EBS had a total loan portfolio of €17.2bn. Bank of Ireland transferred €10bn of loans to NAMA for which it received €6bn. According to the Bank of Ireland annual report for 2009, Bank of Ireland had a total loan portfolio of €106bn.

In other words, €30bn was transferred from AIB, EBS and Bank of Ireland out of a total loan portfolio of €246bn. NAMA carefully valued these loans and paid €16bn for them. So the banks received nice clean cash equivalent funds but they had to crystallise large losses. If NAMA had not existed, these banks would be managing those loans today, would be obtaining cash advances from the ECB secured on these loans and would be offering them for sale and generally working out the loans. What NAMA has done is impose a massive administration and cost burden on these banks, forced them to crystallise losses now and deprive the banks of a portion of their stock-in-trade to generate profit and cash flow. If NAMA had not existed, it is hard to see how the operations of these banks would have been disadvantaged today.

It is a fact that deposits at AIB and Bank of Ireland, and non-NAMA bank Permanent TSB, have stabilised and since July 2011, in fact have gently grown. But would depositors have been deterred by AIB/Bank of Ireland having €30bn of property development loans of doubtful value in the context of nearly €250bn of total lending? Given the mortgage crisis that intensified after the NAMA transfers, and the fact that AIB and Bank of Ireland are both heavily exposed to mortgage lending, you would have to challenge the notion that it was the removal of the fraction of loans that went to NAMA, that stabilised the banks and inspired the confidence amongst depositors to stop withdrawing funds. The evidence suggests that it was in fact the stress-testing of the banks in March 2011, followed by massive recapitalisation and the intensive oversight by the bailout Troika, particularly the ECB that boosted depositor confidence. Not the NAMA process.

The NAMA process has transferred an additional €5.6bn in state aid to the banks, state-aid which is mostly represented by the long term economic value premium which the NAMA scheme involved. We, the public are on the hook for this state aid which is additional to the €64.1bn pumped into the banks. NAMA’s early years are proving challenging with loans declining further in value, and you would have to say that in 2012, we cannot be confident that NAMA will break even by 2020, the short to medium term outlook in particular is challenging. The NAMA scheme may have removed a modicum of doubt over the value of the banks, but there has been a transfer of doubt onto the shoulders of the nation, as we wait to see how NAMA performs.

So who do we blame? The late Minister for Finance Brian Lenihan was the minister who approved the NAMA scheme and it was he who led the legislation through the Oireachtas and then defended the Agency from its inception in December 2009 until his departure from government in February 2011. A man for whom there is justifiably a lot of regard, the fact remains that NAMA and the preceding bank guarantee are his legacies. And whilst Brian Lenihan might have sadly shuffled off this mortal coil, his boss, Brian “we are not fucking nationalising Anglo” Cowen deliberately vanished from the national stage in February 2011 but the buck stopped with him.

We can certainly blame the Secretary General at the Department of Finance during 2009, David Doyle and his deputy Kevin Cardiff (picture above) who was subsequently promoted to Secretary General in February 2010 where he clocked in until his ignominious exit/glorious promotion at the start of 2012. Kevin Cardiff might be best remembered for being at the helm when the €3.6bn error in the national accounts was uncovered, but far more serious was the Wikileaks revelation/claim that he had hinted to the US ambassador to Ireland, in early 2009 that the ultimate discount on loans transferred from the banks to NAMA might be 50%, instead of the 30% that was publicly discussed. With a property market still tanking some months later at the end of 2009, it should have been obvious that the discount would have been nearer 60%, at which point, the banks were mostly rendered zombified and in need of substantial further bailouts. And consequently, the NAMA scheme could not have worked.

We can probably blame Minister Lenihan’s special adviser from March 2009, Dr Alan Ahearne (picture above), who, after his adventure at the Department of Finance, returned to lecturing at the National University of Ireland in Galway, and at the same time was ennobled with an appointment to the board of the Central Bank of Ireland. Earlier this year, Dr Alan penned an article for the Independent in which he attacked critics of NAMA, accusing them of moving the goalposts, which was rich when that is precisely what Dr Alan does by advancing as his main justification for NAMA, the saving to the State of working out €75bn of loans over a longer period of time than would otherwise have been allowed under the Troika-mandated deleveraging targets. The problem with Dr Alan’s contention is, back in 2009 when NAMA was conceived, there was no Troika, it only arrived on the scene in November 2010. Dr Alan deserves to be stoned if he is suggesting he had the prescience in 2009 that the country would enter a bailout programme in late 2010 which would involve the mandatory sale of bank of assets. Furthermore it is eminently arguable that it was NAMA’s crystallisation of losses in the banks in March to May 2010 when the first tranche was transferred, which ultimately forced this country into a bailout. Instead of 30% haircuts, we had 60% haircuts and the markets were justifiably spooked with concerns about the remaining loans, particularly commercial property.

And lastly we can probably blame Peter Bacon, the economics consultant who was the darling of the last administration but more recently seems to have fallen from favour, with his Treasury Holdings-sponsored report not doing anything to recover his fortunes. In April 2009, Peter produced a report “Proposal for a National Asset Management Agency” – note that just the abridged version of the report is in the public domain – which addressed €80-90bn of lending in the banks, but failed to address the difficulties that would be caused if the discount on the loans was too severe. Peter’s report did recommend that all doubts be removed on the capital adequacy of banks but only dealt with a quarter of the extant lending, and we now have issues with the residual property lending that NAMA left in the banks, not to mention the residential mortgage books. Of course hindsight is a terrific advantage but looking back at the report today, it is still surprising that no consideration was given to the depth of the hole that NAMA could leave behind in the banks after crystallising losses.

The distinction between the NAMA project and the organisation NAMA should be made. The NAMA organisation has done the job assigned to it in the NAMA scheme, though the jury is still out on how well it is doing that job. It is the NAMA scheme that was wrongly designed, and the singular failure was not validating the loan losses at any early stage. If NAMA had not existed, then we would have avoided colossal administrative costs and time, there is strong evidence we would have avoided a bailout and consequent deleveraging of banks at the behest of the Troika, we would not have the risk of the NAMA operation on the nation’s finances and we would have banks whose expertise was in loan workouts, managing the loans today.

It was on the 24th and 25th of July 2012 that NAMA had receivers appointed to companies controlled by Derek O’Leary and Reginald Tuthill, and yesterday in Dublin’s High Court, the Agency lodged an application against some of their companies and also against Messrs O’Leary and Tuthill as individuals.

The case reference is 2012/3264 S and the respondents named are (1) Sandyford Forum Developments Limited (2) Blackthorn Securities PLC (3) Maycombe Developments Limited (4) Stuart Tuthill and (5) Derek O’Leary. As is usual with recently-filed applications, there is no solicitor on record for the respondents.

The applicant is National Asset Management Limited which is represented by Dublin solicitors Beauchamps.

In the past, NAMA has taken legal action against individuals to enforce personal guarantees or to secure personal judgments, but it should be stressed that we do not know if either of these objectives lies behind the current application. NAMA generally doesn’t comment on individual legal cases.

So far this year, NAMA has launched 21 separate actions in Dublin’s High Court and has been on the receiving end of six.

The view on here is that IBRC will eventually be merged with NAMA; it may take some time – months or years – but it is complete nuts to maintain two 100% state-owned agencies doing precisely the same job – IBRC might still be classed as a bank, but for the purposes of the following it is regarded as a state agency whose sole shareholder in the Minister for Finance, Michael Noonan.

A merger might be too challenging a task in 2012, but by 2020 when both NAMA and IBRC are scheduled to wind down, it seems implausible that we would still have two agencies with an inefficient duplication of costs, dysfunctionally competing with each other rather than combining their talents to take advantage of best individual practices and to compete with non-state-owned asset management companies.

But which agency should take the senior role in any merger?

You might start out by asking which agency is presently doing the better job in managing its assets, but sadly neither NAMA nor IBRC publishes sufficient information to allow you make a reliable overall assessment. You can glance off some peripheral aspects of both agencies’ published accounts, like non performing loans, and you might conclude IBRC is doing a worse job than NAMA because the rate of deterioration in its loans is worse than NAMA’s. You might also note the €247m profit delivered by NAMA in 2011 and compare that to the €935m loss at IBRC, but the view on here, is that both agencies are hiding a veritable hornets nest of problems in the way they account for loan impairments and NAMA’s €235m tax credit in 2011 doesn’t fool anyone. But overall, you just don’t have enough information to meaningfully conclude which agency is doing better with managing its assets.

And what about costs? NAMA and IBRC are managing loan portfolios of a similar magnitude, though NAMA’s net-of-provisions total of €26bn is greater than IBRC’s €19bn. What does stand out is the fact that NAMA’s operating costs are less than half those of IBRC’s – in 2011 NAMA racked up €128m of operating costs (see above extract from the 2011 annual report) compared to €320m at IBRC (see below extract from the 2011 annual report). For 2012, NAMA has published a forecast of its costs at €194m for this year, and IBRC’s actual H1,2012 costs of €129m indicate that its total costs for 2012 will be down from 2011.

There might be many reasons for the disparity, but there is a sneaking feeling on here that NAMA’s CEO Brendan McDonagh is better at keeping a lid on costs, though he has the advantage of building an asset management company from scratch whereas IBRC’s CEO Mike Aynsley inherited a company in late 2009 which had well-documented poor lending practices and may well have had poor cost control as well, with legacy contracts which couldn’t be avoided. Also, the fact that NAMA’s budgeted costs for 2012 declined from €242m in its projections last September 2011 to €194m this February 2012, may have been due to rigorous cost control, but past experience tells us that NAMA just didn’t scrutinise the costs sufficiently.

In trying to compare operating costs between NAMA and IBRC, what does become obvious is that we have far greater transparency from NAMA. Remember that NAMA produces quarterly reports and accounts, as well as an annual statement and projection of costs, not to mention an annual report. NAMA is summoned to Oireachtas committees every six months (on average) and if you review parliamentary questions, you’ll see that NAMA is subjected to far more frequent and intrusive scrutiny. Despite both IBRC and NAMA being 100% state-owned, doing the same job with similar employee numbers and the same ballpark value of assets, the truth is that we have very little scrutiny of IBRC’s operations, and this would be another reason to merge the two agencies together.

Last week when IBRC reported its results for the first six months of 2012, it claimed that it had undertaken a “cost management exercise” which has led to savings. There is no obvious mechanism at present whereby best practice in NAMA and IBRC is being shared. Our doddering Department of Finance is unlikely to have the nous to examine costs across both agencies, but commonsense tells us that one agency or the other will have better practices or contracts in specific areas. But given the sensible likelihood of an eventual merger, perhaps we can prod the powers that be to start examining costs now – with a combined total of operating costs in 2012 of €400-500m, it would be astonishing if savings couldn’t be achieved.

This time last year, we had the Morgan Kelly article at the start of August warning about the mortgage crisis, we had what seemed like a knee-jerk reaction with the Government rustling up from nowhere the Keane research which led to the Keane report published in October after President Bill Clinton identified the mortgage crisis as the number one economic problem facing the country. And remember MP Mac Domhnaill, the man from Kerry whose heartbreaking letter to the Irish Times aroused widespread sympathy and alarm?

A year later and the mortgage crisis has intensified; figures released last week show the number of mortgage accounts in arrears has increased by 50% in the past year, that more than 83,000 owner-occupier mortgage accounts are now in arrears of more than 90 days, and when taking into account all arrears including those less than 90 days and the number of restructured mortgages, some of which might be repaying zero at present, then 22% of mortgages are in trouble.

There has been a slight relenting in the pace of increase in the last two quarters, but the numbers are getting worse. And responding that 78% of mortgage accounts are being repaid on time isn’t much more helpful than saying that with only 11 homicides in Q3,2011 in Ireland, the vast majority of the 4.6m in the State wasn’t murdered, that there were 28 Tiger Kidnap offences but again 4.6m people weren’t kidnapped or that 630 people were sexually assaulted but most weren’t. Every single household in arrears should be a matter for concern.

Figures gratefully received today from the UK’s Council of Mortgage Lenders for the second quarter of 2012 show just how dysfunctional our mortgage crisis has become. In the UK less than 2% of mortgage accounts are in arrears for more than 90 days, in Ireland the latest figures show 10.9%. Despite having a healthier economy, lower unemployment with property prices down just 10% from peak, you are 23 times more likely to have your home repossessed in the UK if you run into difficulty.

Whilst accepting that the UK is a different jurisdiction with a different economy, history and culture, it is our closest neighbour both geographically and arguably, socially; so when there are big differences – be that in unemployment benefit rates or the cost of health or broadband – then questions suggest themselves. Ultimately there may be justifiable reasons for disparity, but when there are such stark differences, it seems sensible to at least ask why.

It may seem heartless to call for more repossessions in Ireland, but by sticking our heads in the sand, we are consenting to perpetual social harm and economic blight. Of course keeping the family home should be a social and economic priority, but we need to debate if it is better to put a merciful end to hopeless cases and provide social housing or rent assistance. And if we had a proper personal insolvency regime, then we might find banks willing to do deals in cases which might otherwise be hopeless. Otherwise we continue to have large numbers of households frozen in fear for the future with all the distress that causes, plus the economic harm of households not spending in anticipation of imminent distress – bad for the economy and even worse for society.

One of Ireland’s formerly biggest property companies, Treasury Holdings faces its fate this afternoon – from 12 midday, in Dublin’s High Court – as Belgian bank KBC resumes its bid to have Treasury wound up. Yesterday, Treasury told the court that KBC had an ulterior motive in pursuing the winding up petition at this juncture, and that ulterior motive was to assist NAMA. Last month, NAMA defeated Treasury’s legal bid to overturn the decision by NAMA to foreclose on Treasury’s loans to the Agency. At the time, Treasury said it would appeal the decision to the Supreme Court, but if a winding up order is granted now to KBC, then the current owners of Treasury, Johnny Ronan and Richard Barrett will lose control of their company, and the appeal against NAMA may be abandoned. At least, this is what is being alleged by Treasury.

For its part yesterday, KBC said it was pursuing the repayment of its portion of a €270m loan advanced to Treasury and 15 companies within the Treasury group, all for the redevelopment of the Spencer Dock area of central Dublin – a slice of land on the north side of the Liffey which includes the National Convention Centre. KBC was seemingly highly dismissive of Treasury’s latest White Knight, Morgan Stanley which Treasury said offered the potential to invest in the company. Morgan Stanley is but the latest in a loooong line of investors to have an initial dalliance with Treasury, but didn’t progress into anything serious. US investor CIM, and separately US investor Hines and Aussie investor Macquarie all courted Treasury in the past 18 months, but their offers were ultimately rejected by NAMA. KBC said it was rejecting the Morgan Stanley offer as it did “not make commercial sense to the bank and had been refused”

Treasury is seeking an adjournment of the winding up petition. According to the Irish Independent, KBC complained to the court that “request for an adjournment of the petition [by Treasury] was “simply asking the court to allow Treasury trade while wholly insolvent.””

Treasury concedes it is insolvent, but claims that 300 Irish jobs are at stake if the group is wound up. The “300” figure seems to include Treasury’s assessment of externally related jobs in Ireland that would be at risk – Treasury told the High Court in the NAMA judicial review case, which it lost, that the company employed just 45 people in Ireland.

The case resumes at 12 midday today, and it is hard to see it continuing much longer.

UPDATE (2): 28th August, 2012. RTE is reporting the recent transfer of two companies hitherto associated with Treasury China’s operations have been transferred to a Jersey-based company called “Oriental Management Services” which RTE says is beneficially owned by Treasury co-founder, Richard Barrett. It seems that NAMA is not happy with some recent transfers, understood to be these two which RTE is reporting, and has now weighed in behind KBC in supporting the bid to have Treasury Holdings wound up.

UPDATE (3): 28th August, 2012. The hearing has concluded for the time being, and the matter has been adjourned until 9th October, 2012 by the judge, Mr Justice Brian McGovern with several orders including, according to RTE, the production of “a sworn documents outlining the terms and circumstances of a transfer of the assets of a Treasury subsidiary in Singapore to a company beneficially owned by a director of Treasury, Richard Barrett.” and that there be “no disposition by any companies in the group of their shares before 9 October”. According to RTE, the judge saw no prejudice to KBC’s rights from the 6-week adjournment and also said the matter would not be adjourned further, but would be decided on 9th October.

UPDATE: 31st August, 2012. According to the Irish Independent today, the two companies sold to Richard Barrett were Treasury Holdings Real Estate PTE and Treasury Holdings (Shanghai) Property Co Limited and that Richard Barrett paid €2.236m for the two companies. Richard is reported to have told the Independent that NAMA “knew the deal was on the cards well in advance” and as for the €2.236m purchase price “It was the higher of two independent valuations obtained from accountancy firms, he said. The accountants cannot be identified because of confidentiality agreements, but neither is Treasury’s own auditor, he said.”

On Thursday, the Central Bank of Ireland published data on owner occupier mortgages, which confirm that the mortgage crisis is intensifying though at a slower rate than previously. Nearly one in four owner occupier mortgages in the State is in arrears or has been restructured. Minister Noonan previously said that under the right conditions, the Irish economy could take off like a rocket and here is Japlandic’s response incorporating the latest mortgage arrears data. It shows that actual arrears over 90 days have risen to €1.4bn on loan balances of €16.5bn.

“chinky Orange bastard” William Magee, chairman of the Sandy Row Amateur Boxing Club in Belfast which, during the week, published a 57-page report on sectarianism in boxing in 2000-2010, and who claimed “one of our best boxers, a lad from a Chinese ethnic background, was called a ‘chinky Orange bastard’” The report is not online. Following the fantastic success of two Belfast boxers, Paddy Barnes and Michael Conlan, in the recent London 2012 Olympics and the announcement of €4m of Assembly funding for the sport, it is to be hoped that the noble sport of boxing becomes an inclusive activity that generates pride in all communities.

Budget 2013 conniptions of the Week

It’s still three months away but Budget 2013, which An Taoiseach Enda Kenny thinks will be the toughest of this government term – I suppose if the Coalition collapses in 2013, he might be right! – but already kites are being flown and shot down at an impressive rate.

“Fine Gael backbenchers –backed by Agriculture Minister Simon Coveney — are threatening open revolt if Education Minister Ruairi Quinn includes assets like farmland and business premises in means tests for college grants, under an overhaul of the current system. Money held in savings accounts and second homes may also be used in the means test, and farmers and the self-employed may be forced to show their earnings for the previous three years if their children are to qualify for grants.” The Irish Independent reporting on what may strike many observers as strange, protests that illiquid assets against which loans can be obtained shall not be used in means-testing college grants.

The Irish Department of Finance published the latest update to the Memorandum of Understanding with the bailout Troika. Unlike the May 2012 edition where Minister Noonan sneaked in a commitment to repay NAMA debt, this edition doesn’t appear to contain changes. But that hasn’t stopped the traditional media ringing alarm bells on the content of the forthcoming budget in December 2013. This is in fact what the MoU says, and remember there is one more Troika review between now and December and as the MoU says: “the Government may substitute one or more measures with others of equally good value”. It’s not over until the fat man sings at the start of December and even then, he will require a majority to support the subsequent enactment of the budget.

Political Party of the Week

The Democratic Unionist Party (DUP). On a serious note, the largest party in Northern Ireland can be justifiably proud of two achievements this week. On Wednesday, Maurice Morrow (otherwise known as Lord Morrow, pictured above) introduced a Bill aimed at tackling Human Being Trafficking (HBT) and prostitution, in Northern Ireland. The Bill seems to place the needs of the victim – the trafficked individual and the prostitute – at the heart of the proposed new legislation. It would also, as in Sweden, make paying for sex a crime which shifts criminality away from the prostitute. Accompanying the Bill, is a consultation document. The Bill itself entitled “Human Trafficking & Exploitation (Further Provisions & Support for Victims) Bill” is online here, and is a fine piece of work by the DUP which deservedly has cross-party support, and is even finding support on this side of the Border.

On Wednesday also, Sammy Wilson of the DUP (pictured above), the Northern Ireland Minister for Finance and Personnel, launched a new house price series based on all stamp duty returns. The new series which will be published on a quarterly basis has catapulted Northern Ireland well ahead of the Republic for transparency in property prices, as the new series captures all transactions – mortgage and cash. Meanwhile the CSO may/or may not publish an overall total for the cash component of the residential property market when it publishes its mortgage-only index next week.

Quotation of the Week

“I refuse to answer that question” developer Jerry Beadesin response to a question from Ireland’s very own Judge Roy Bean, otherwise known as Mr Justice Peter Kelly in a case where Bank of Scotland was pursuing a summary judgment for €9.7m of loans. The question was whether or not Jerry had received the loans from BoS, and it seems Jerry picked the wrong forum to plead “the Fifth” because (1) this is Ireland and we don’t have a “Fifth” and (2) in a case where a bank is pursuing repayment of a loan, the very least that a borrower can expect to be asked is whether or not he received the loan. Judge Kelly was having none of it and awarded the bank the summary judgment it was seeking.

“It would not be a case of getting rid of the isles, but of transforming unused terrain into capital that can generate revenue, for a fair price” Greek prime minister Antonio Samarasspeaking to France’s “Le Monde” newspaper, putting the best possible spin on proposals to sell off Greek islands

Order of Lenin

“Today, we honour his civilian legacy. The brilliant Minister for Finance. The outstanding organiser who brought Lenin himself to Ireland to see how the National Loan worked” Comrade Enda Kenny marking the 90th anniversary of the death of War of Independence/Liberation hero Michael Collins at the site of his killing at Beal na mBlath in county Cork.

“Enda Kenny was this year’s orator at the annual commemoration ceremony at Béal na Blá last Sunday and he engaged in the usual acclaim of the “fallen hero” – to be fair to Enda that was a cliche he avoided. Michael Collins, he said, was “a reformer, a thinker, a moderniser (who would have been) pro-Europe”, “brilliant minister for finance”, “thoughtful”, “disciplined”. And an extraordinary claim: “The outstanding organiser who brought Lenin to Ireland to see how the National Loan worked.” Lenin was never in Ireland.” Comrade Vincent Browne whose ripe old years and left-leaning tendencies might mean he had first-hand knowledge of Vladimir Lenin (1870 – 1924) and his travel itineraries.

“It mistakenly stated that Lenin came to Ireland but should have stated that it brought Lenin’s attention to Ireland to see how the National Loan worked” Unidentified comrade spokesperson for Enda Kenny

“The outstanding organiser who brought Lenin’s attention to Ireland to see how the National Loan worked.” The original speech on the Government website MerrionStreet.ie has been airbrushed from history and the corrected version replaces it. Hmm “airbrushing” and the Soviet-era, reminds us of the fate of poor old Comrade Yeshov who had fallen foul of Comrade Stalin

“Strange days indeed, most peculiar mama” Comrade John Lennon – maybe that’s who An Taoiseach was referring to.

Our Sh*t doesn’t Smell of the Week

The sad fact about Irish traditional media is that it is universally suffering from the double whammy of, on one hand, an increasingly crowded marketplace which includes the presence of trans-national media and on the other, an economy which nosedived nearly 10% and which is at best bouncing along the bottom. So revenues from circulation (print), advertising (print and broadcast) and sponsorship have plummeted whilst costs have remained stubbornly high despite retrenchment. On here, a particular target has been the woes at IN&M, but that’s mostly because that group more than others takes pot shots at its rivals, when in fact, all media companies are struggling.

On Friday, the Irish Times reported its results for 2011 with the headline “Irish Times posts €2.5m operating profit” though if you delve deeper into the article you will find that the loss after tax ballooned by 63% from €1.1m to €1.8m. Though I suppose who can blame the IT when IN&M routinely tells you about its €80m operating profit in 2011 but neglects to mention the after tax loss of €41m. Even RTE has gotten in on the game headlining its €17m deficit in 2011, but burying the true loss of €69m coming on the back of its pension costs. TV3 is unapologetically hyping its own financial performance of profit after tax of €68m in 2011 but neglects to tell you about the €80m loan from Anglo which has been “parked”, and without the parking of which there would have been a loss.

It may be the holiday season but NAMA continues with its foreclosure action. According to today’s edition of Iris Oifigiuil, on 21st August, 2012 NAMA had George Maloney of Baker Tilly Ryan Glennon appointed as receivers to South County Developments Limited, a Dublin-based developer owned by Colum Butler and a company called Bucart Limited, a company in which Ciaran Butler is a director and which is in turn 100% owned by Astrofel Properties Holdings.

Brothers Ciaran and Colum Butler are best known for their operation of the Leisureplex chain which includes bowling alleys in Tallaght, Blanchardstown, Coolock and in Stillorgan in Dublin as well as one in Cork city centre, and have worked with other well-known developers like Bernard McNamara in the past. There is no suggestion that any company other than South County Developments Limited has been affected by the receiver appointment.